SAN FRANCISCO--(BUSINESS WIRE)--Prosper.com, the world’s largest peer-to-peer lending marketplace with over one million members and $214 million in funded loans, today announced that interest rates have been reduced on many loans to help the best borrowers save more money in 2011.
Starting today, interest rates on new loans for Prosper borrowers with better Prosper Ratings will be significantly lower. For example, a borrower with an “AA” Prosper Rating could get a one-year loan with an interest rate as low as 4.99% (a 5.9% APR*), down from a previous interest rate of 6.65%.
Prosper has seen strong and growing demand among its lender community for high quality borrowers, with overall actual lender returns now at 10.1%**. In fact, loans listed by borrowers are funding at a rate of nearly 100%. This has made it possible to lower rates for Prosper borrowers, while still offering extremely competitive returns for diversified Prosper lenders.
“We looked at the data closely and determined that rates could be lowered even further for many borrowers and still offer very attractive overall returns for lenders,” said Jim Catlin, Executive Vice President of Acquisition and Risk Management at Prosper. “We’re pleased that the Prosper marketplace has some of the most affordable loan rates available that will benefit individuals and families looking to reduce expensive credit card debt, make much needed home repairs, purchase a car to get to and from work or help fund a small business.”
Click here to view the latest Prosper rates.
*Based on personal loans made to borrowers with an AA Prosper Rating. APRs by Prosper Rating range from 5.93% (AA) to 35.64% (E). Rate offered is based on Prosper Rating and other factors and your actual rate may differ. Eligibility for a loan is not guaranteed and requires that a sufficient number of investors commit to fund your loan. Refer to Borrower Registration Agreement for all terms and conditions. All loans made by WebBank, a Utah-chartered Industrial Bank.
**Net Annualized Returns represent the actual returns on Borrower Payment Dependent Notes (“Notes”) issued and sold by Prosper since July 15, 2009. To be included in the calculation of Net Annualized Returns, Notes must be associated with a borrower loan originated more than 10 months ago; this calculation uses loans originated through February 28, 2010. To calculate Net Annualized Returns, all payments received on borrower loans corresponding to eligible Notes, net of principal repayment, credit losses and servicing costs for such loans, are aggregated then divided by the average daily amount of aggregate outstanding principal for such loans. To annualize this cumulative return, the cumulative number is divided by the dollar-weighted average age of the loans in days and then multiplied by 365. Net Annualized Returns are not necessarily indicative of the future performance of any Notes. All calculations made as of December 31, 2010.
About Prosper
Prosper Marketplace Inc. is the world's largest peer-to-peer lending marketplace with over one million members and more than $214 million in funded loans.
Prosper allows people to invest in each other in a way that is financially and socially rewarding. Borrowers list loan requests between $2,000 and $25,000 with loan terms of 1,3, or 5 years. For example, a $5,000 loan with a 3 year loan term for a person with a Prosper Rating of A would have an 11.65% APR and scheduled monthly payments of $160.28. Individual and institutional investors invest in minimum increments of $25 on loan listings they select. In addition to credit scores, ratings and histories, investors can consider borrowers' personal loan descriptions, endorsements from friends, and community affiliations. Once the auction ends, Prosper handles the funding and servicing of the loan on behalf of the matched borrowers and investors.
Prosper was co-founded by Chris Larsen, co-founder of E-LOAN. Prosper has raised $57.7 million in venture capital and is backed by financial and technology luminaries including, Jim Breyer of Accel Partners; Bob Kagle of Benchmark Capital; CompuCredit; Omidyar Network; Capital One Co-founder Nigel Morris of QED Investors; Court Coursey of TomorrowVentures; and Larry Cheng of Volition Capital.
Notes offered by Prospectus.